This passage is a paraphrase that misses something...
What Nash was doing was he was running around saying he was the next Jesus. The reason he was thinking this was because he believed that his insight "Ideal Money" was the solution to the Israel/Palestine Conflict or ie peace in the middle east.

Consider this observation he makes about himself of that time:
But more recently how he explains how he prepares to present his lecture/proposal "Ideal Money":

The reason, hasn't changed since the time he thought he was the next jesus. He matured and understood that you can't make this rational social advancement politically.

Fuller wiki passage:


The idea is that our psychology is tied to our global currency systems or rather the fragmentation of it. Thus its marked by differing inflation rates and or differing exchange rates. But this isn't perfectly observable since we don't have an objective metric. It's hard to approach but Nash defines it as a game and notes the Nash equilibrium in the game. It's not bitcoin, its not gold, its not a perfect set of commodities, its not 0% inflation etc.

But it exists theoretically. And its approachable.

The idea is that as we evolve towards it through natural order we might eventually collectively realize the existence of it and reflexively bring it about (ie move all currencies to the single order) through reason. And that as a non-obvious corollary as we move towards more fragmented currencies and instability ie inflation it affects our psychology negatively and proportionally.

What...the...****...

Button, that's great news. Or I'm sorry that happened.

It's a simple conjecture. Our psychology is tied to the inter-relational stability of our currencies. The suggestion that WWI and WWII were a product of breaking from the gold standard, and the ending of them the construction of the bretton woods standard...

And then it suggest the present day growing global conflict is tied to the sort of rampant money printing into inflation. And that we are about to move to a new monetary standard which isn't bitcoin pre se.

tldr; Is our psychology tied to exchange rates of currencies?

I just realized that Nancy Reagan was right all along. Just say no to drugs kids.

2% is preferred over 0.

Burton, would you prefer to go back to the gold standard?

We are thinking about a basis for the global financial system, so the gold standard is relevant yes...but instead of yay or nay, we want to consider what made gold useful but also what its flaw were. ..

The cost to mine, that changes sometimes based on the technology matters, in regard to the scarcity properties that such a standard might rely on and put pressure on...
And if we are thinking about the new choice for the X standard, we have to consider the geo-political ramifications of the chosen commodity or commodities....
Other examples and price basket compositions shows that there exists a vector for quality....
And we consider a hypothetical miracle energy source, that reduces the cost to produce one or some of the commodities chosen, and how that implies there would always be a need to readjust the 'basket':..


We need to satisfy these principles.

Now you did it, Formula. We are never going to hear the end of it now.

A Left Answer to Inflation

In the 1940s, with the experience of the Great Depression freshly seared into the collective American consciousness, free market economists like Milton Friedman were generally regarded as right wing cranks for believing that government interventions — such as rent control, a minimum wage, even national parks — only got in the way of the market’s superior rationality.

The ideas and policies that dominated economic discourse after the Great Depression were decidedly more left wing. Keynesianism, named after its leading theoretician John Maynard Keynes, emphasized an active borrow-and-spend role for government to maintain full employment and keep the economy humming. But within a few decades, conservative economics gained political hegemony. Friedman himself won the Nobel Prize in economics in 1976, and advised or influenced a global who’s who of right wing leaders, from Ronald Reagan to Margaret Thatcher to Augusto Pinochet. And the ideas of the Chicago school, as Friedman’s brand of economics came to be known, now dominate the current response to the inflationary crisis.

.....

Milton Friedman said in 1982 that you need ​“ideas that are lying around,” until a crisis arises when ​“the politically impossible becomes the politically inevitable.” For Friedman, that opportunity came in the form of a ​“stagflation” recession (so-called for combining high rates of inflation with stagnant economic growth) in the 1970s. The spiraling inflationary crisis and its eventual resolution through drastic monetary tightening seemed to vindicate Friedman’s ideas. Keynesian economic policy was definitively replaced by a conservative economic orthodoxy.

The 1970s proved to be a pivot of economic eras in the United States as the postwar Golden Age boom came to an end. U.S. factories faced competitive pressure from Western Europe and Japan; an oil embargo from Arab members of OPEC contributed to skyrocketing energy costs; and a militant labor movement at home successfully fought for higher wages and greater control on the shop floor, ensuring wage growth outpaced productivity gains. As corporate manufacturing profits shrank, American capitalists responded by hiking prices. In doing so, they unleashed an inflationary spiral.

In what came to be known as the ​“Volcker shock,” then Federal Reserve Chair Paul Volcker engineered an unprecedented hike in interest rates. Higher rates slowed investment and shuttered many businesses, which lowered consumer demand and triggered massive unemployment. That unemployment was not an accident — Volcker intended to break workers’ confidence so they would not demand higher wages. Meanwhile, the Reagan White House did its part by firing more than 11,000 striking air traffic controllers in 1981, making it clear which side of the class struggle the government was on.

.....

For a brief moment last year, the scale of the economic crisis wrought by the pandemic looked like it might force a more dovish economic approach from the American ruling class. The government ramped up deficit fueled stimulus spending. The Federal Reserve kept the spigot of cheap cash flowing. Poverty levels actually dropped in the midst of a severe economic crisis, and the wide chasm of U.S. income inequality narrowed ever so slightly.

Early in 2021, when the prospect of inflation first reared its head, talk of rolling back government stimulus was still an outlier position. Neoliberal economist Larry Summers returned from hibernation to argue against giving too much help to struggling households. But for a blissful moment, his arguments were confined to a few dissident editorials, seemingly ignored by those in power. Federal Reserve Chair Jerome Powell argued that rising prices were a short-term, transitory problem because of supply chain shocks and the pandemic.

But inflation has stubbornly stuck around, propelled by a number of factors. Thin inventories motivated by just-in-time production methods made it difficult to meet growing demand. Russia’s invasion of Ukraine contributed to high oil prices, which impact almost every part of the economy. Pandemic-era benefits modestly fueled demand by putting more money in circulation. And company CEOs took advantage of the increased demand and engaged in price gouging, raising prices much higher than their supply costs.

To say rising wages are playing a role in inflation however — as they did in the 1970s — is a stretch. According to the Bureau of Labor Statistics, real wages (adjusting for inflation) were actually 3% lower this July than last. The failure of wages to keep up with prices is causing real economic pain. All the more so because lower-income households— which are disproportionately households of color — spend at least three-quarters of their income on necessities.

Nevertheless, corporations are fearful that the tight labor market will eventually cause wages to rise. A June Bank of America memo, obtained by The Intercept, bemoaned that it will ​“be hard to reverse” tight labor conditions and upward wage pressures. For workers, that would be good news, as the effects of inflation would be offset by higher wages. To those in charge of fiscal policy, however, controlling inflation (largely to the benefit of business) is considered more important than maintaining low unemployment (to the benefit of workers).

.....

A LEFT RESPONSE

Karl Marx argued that capitalism depends on unemployment — a ​“reserve army of labor” — to keep workers desperate enough to agree to whatever work they get. Unemployment, in other words, plays a critical role in capitalism, preventing wage growth from threatening profitability.

By definition, capitalism holds us hostage to the market’s profit motive. Even in ​“good times,” the consequences are dire — as investment flows toward fossil fuels rather than ecological sustainability, for example, or toward pharmaceutical windfalls rather than equitable vaccination distribution. But in bad times, our lives are thrown into chaos and despair, subjected as we are to the whims and impacts of supply and demand.

Capitalism cyclically falls into crises of inflation and recession, and as another wave hits, the Federal Reserve and the White House are determined to force working people to carry the burden through layoffs, diminished wages and an inadequate social safety net. If capitalist profits were on the hook instead (by taxing the rich and corporations, say, or through targeted price controls), then pro-worker policies could be put into place (such as lowering the social costs of childcare, housing and healthcare).

.....

Higher taxes would simultaneously reduce the government deficit (the bête noire of the monetarists) and reduce inequality. The Inflation Reduction Act does take this approach, with a 15% corporate minimum tax that nullifies tax loopholes and a 1% tax on stock repurchases, targeting companies reaping the biggest profits from inflation. A proposal by Sen. Bernie Sanders would have done so more effectively, by taxing at 95% the profits of companies making more than they did before Covid-19.

Price controls are less familiar to today’s progressive movement, but, in fact, they are a necessary response to the realities of the ​“free market.” There is nothing ​“natural” or ​“fair” about the market determining prices — especially because sellers simply ​“pick their price” in a market that’s in short supply (economists’ sterile description of ​“price gouging”).

And price controls have actually been used throughout U.S. history. As political scientist Todd Tucker pointed out, FDR employed 160,000 federal employees in the Office of Price Administration to control prices ​“on goods from scrap steel to shoes to milk.” Even President Richard Nixon briefly implemented price controls. Most recently, the U.S. government’s provision of free Covid vaccines was a form of price control, as the state directly negotiated prices.

Most immediately, capping the prices of energy and fuel would protect working people’s pockets and reduce production costs for businesses across the economy. Of course, such measures would make a dent in the oil industry’s profits — but this should be seen as part of a longer-term strategy to transition away from fossil fuels. Another immediate course would be to pursue aggressive anti-trust measures, which would help tame the price-setting powers of monopolies.

In arenas where the federal government has significant economic authority, such as healthcare and higher education, this authority should be wielded to drive down prices. As the Left has long argued, allowing Medicare to negotiate fair prices for prescription drugs would lower costs dramatically, as private prices tend to follow Medicare’s lead. Federal funding for higher education, which accounts for about 14% of college revenue, could be tied to caps on tuition increases.

.....

'Price controls are a necessary response to the realities of the “free market.” There is nothing “natural” or “fair” about the market determining prices.'

.....

Neoclassical economic philosophy provided both a technical tool and a political cover for the American ruling class to roll back the gains of the New Deal and the postwar boom. The past four decades of neoliberal rule have been their victory dance.

The Left urgently needs an answer to inflation. In the short term, we need to articulate and organize for an economic agenda that mitigates the effects of the crisis for working people by taxing the rich, controlling prices and socializing major expenses. Critically, we need to back labor organizing that pushes for higher wages, and reject narratives that ​“too high” wages are a problem.

In the long term — recognizing that capitalism is an inherently unstable system that resolves its crises on the backs of working people — a left economic agenda needs to frame a vision for a different kind of economy, one based on human need rather than corporate profit. Right now, even minor advances in working-class living standards result in devastating economic lurches. How can a system be defended if it goes into crisis at the very prospect of slight wage increases? Or in response to a government bailout of the unemployed during a pandemic? Is the current system really the best we can do?

bitcoin fixes this...lol

(I read ur post and used some chatGtp for a general idea of some of the political references I'm not strong with)

I think that we have to make note of the different perspectives with regard to the national vs the global. Whether or what the different would be between to the two perspectives. Keynesianism I understand the same way as you describe, but note that Keynes proposed the bancor for the post-war arrangement of the global financial system.

The instability of the Triffin dilemma, I think distorts the national considerations.

Also notably about the global view is the nixon shock, when we broke off the floating standard, which was when central banking really took hold as the new paradigm I think thats right? So following the nashian orientation, you would expect to see great global instability at that time, and it becomes unrealistic to think that everyone can 'manage' their currencies and economies to stabilize the fallout from that

I don't yet understand your definition of capitalism, it doesn't seem to fit the wiki I think, nor mine, so there might be room to agree on some things. I have had many people tell me the thesis to TWON, do you have an idea of what you would describe that as or a summary of the book?

I think you are admittedly being semantic here? Or why is free market in quotes? That there is NOTHING natural or fair about market determined prices, I think it sounds like you are angry at the notion. A free market libertarian obviously sees the states ability to enforce rules via a monopoly in violence is what is unnatural and unfair. But thats just your choice of definition verses theirs, or is there more to it?

Then ends is agreeable obv. I think what Nash's work focuses on is the idea that the current central banking framework creates an unchecked ability to fund anything it wants. So you might be used to Chicago or Austrians saying we need to end that ability to fund social programs via that government... I think its fine you disagree, we would both agree a check and balance system for a social government type system we be a good idea.

And that I think without bitcoin we would print ourselves in to oblivion with zero stability as a result. With bitcoin as a beacon, I think humans will realize the important of money as a coordination mechanism. But the ultimate standard is not bitcoin, its an equilibrium of all the major currencies.

This is beyond bitcoin, decades beyond....




(perhaps centuries without the works Ideal Money)

Just FYI I didn't write that article, it was Hadas Thier. I linked to the article at the top of my post.

I don't see the value in getting hung up on the definition of capitalism. Define it however you like. It makes no difference to the thrust of my argument nor that of Hadas Thier. I see your constant attempts to harangue me into a definition as bad faith arguing. It is not some easy simple concept to define in a pithy one phrase sentence. If you do come up with a simple sentence that appears to define it well, you're lacking a lot of detail and such a definition needs significant expansion in order to be useful. It's an entire book's worth of discussion and I don't have the patience nor expertise to get bogged down into the fine detail of why capitalism should or shouldn't be defined in different ways.

If the state were using their monopoly on violence to enforce price controls in the real world, then I'd have more sympathy with the argument. The bit of libertarianism that is divorced from reality, whereby a state should not use its monopoly on violence in order to enforce truly free price mechanisms, is not an awful thing. The problem comes when you use that logic while disregarding the reality that states have been captured by corporations that negotiate for lower taxes and minimize regulations in their sector. Large corporations are inherently undemocratic and they use their influence via lobbying to make the market not at all free. The state ends up using its monopoly on violence in order to steal freedom from the people and give it to corporations. As a libertarian, surely this is the worst possible outcome, and something I've heard libertarians decry? Whether you want to look at the pharmaceutical market, the transportation market, whatever market you like, there is evidence that prices are not the result of natural price signals but the distortions of the market and control of supply and artificial scarcity created by corporations that are not beholden to the benefit of the people at large and are expressly designed to create value for the shareholder, no matter the expense to their workers, their customers, or the environment. That is not a free market.

I caught that after, forgot I pulled the link up, had a millisecond of '**** wazz just plagiarized half this' and then understood your 'quote syntax' all of a sudden ;p My answer seemed appropriate and i think I caught the nature of your intentions, so I forget to mention later I was just gonna leave it as my response anyways.

Nono. I use the wiki definition and defer to it , and appreciate when people point out when I don't understand it properly. You don't, thats completely fine. I'm just trying to get an understanding of how you use that word. I actually think I have a better understand from this last bit...i think you have other starting points and you lead to things that you ascribe to the word capitalism. Thats fine, I will more work to understand these other points and how they lead you to infer what capitalism means to you. I think thats my answer to how you define capitalism

I draw from Ayn rand the complaint that government only ever gives monopoly to their favorite. But regardless it seems we agree the government granting monopoly is bad. I think this is where Nash slices the edge of his argument, by saying we can consider an array of computers. These computers I argue have a computer science axiom that evolves from bitcoin meaning trustless enforcement of (a very small limited amount of) contracts. So philosophical we are asking IF government COULDN'T favor businesses unfairly, then you might not have a problem with corporations getting the size of governments etc. I don't think you need to defend this part ie you might want to say perhaps thats bad because 'obviously a business the size of the government would have power of governments', The hypothetical sort of reveals what we agree on.

You are agreeing on the ends and disagreeing on the means.

thats a conclusion to agree on, but if its true then the free market libertarian should agree. You mean to say what the FML wants to use as the mechanism, doesn't lead to the goal you would agree on. Otherwise you bent the definition of free market for that particular sentence.

But I think also, and this is why I like to bring up the possibility of a syntax that represents or highlights these frameworks, I think we would have to consider that a government has the monopoly over its people, but in a world of competing governments there is no government to grant others priveleage in the same way....or is there?

I'm calling attention to the effects of considerations on these different planes or perspectives.

Fwiw jbuton
I don’t think no one argues that the US dollar is the best solution for an international currency .

It’s been lashed out against since the 1960s with the triffin paradox shrug .

https://en.m.wikipedia.org/wiki/Triffin_dilemma

If u really want to have a more worthwhile conversation maybe u should expose your thesis vs the Bancor concept of keneysian for a global reserve currency ?

https://en.m.wikipedia.org/wiki/Bancor

As Nash noted in one of his papers, Hayek approached it:

https://www.econlib.org/library/Essays/hykKnw.html

Big data does that however in a much more limited sense. Nash says there are theoretical correlates, that Idk, function as a sort of value pilot wave permeating throughout the economy basically maximizing value?

Suppose a general store in a small town barely making Good Money and then along comes Bad Money opening up another one across the street. How would Ideal Money prevent that?

Keynes was looking for a global equilibrium that facilitated trade. The bancor was to be a global settlement unit, but if you follow it had special rules:

When I try to compare the bancor to bitcoin as a global settlement medium I get laughed at by superficial economists. Here I am wanting to point to the ENDS keynes was shooting for to equilibrate trade etc. Bitcoin BUT AS VIEWED from the Nashian orientation, which is also the Hayakian in a sense, conjectures the same ends.

This is where I say Keynesianism isn't Keynes because Keynes sought the Nashian ends as well in a sense. Nash is explicit but its subtle if you aren't careful with his writing:

Keynesian isn't Keynes, necessarily.

this paper:
https://www.bankofcanada.ca/2016/03/...paper-2016-14/

Goes over the math, which is well defined and we could go over, and suggests that its the cost to settle with the base medium that defines the different (real?) interest rates between major currencies:
The reasons the paper suggests this won't happen, which are irrelevant to my point, are quite negligible imo. We are headed for this, tied to the market cap, as it approaches gold's.

The idea is that the cost to arbitrage with gold was related to go political conflict. But a politically borne bancor doesn't solve this problem. So the intentions of Keynes, and the political limitations of his solution, can be encapsulated and addressed with a unit of settlement that no nation controls.

Then a superficial economist wants to argue that won't stimulate trade. But the Nashian argument is that giving political precedence to enforce trade balances etc. is a path to corrupting the settlement system (ie worse than not stimulating trade). Which satisfies Hayek's view:

The theoretical and philosophical device Nash uses he calls an ICPI. An international CPI (but he uses 'industrial' for the I usually):

But now we want to mention another possibility that arises because of the present day circumstances that are relevant to the international interactions of the various national currencies."

He doesn't ever say it would be easy politically, don't let anyone try to fool people:

"It could be very difficult, and a slow process, to set up such a practical and useful system of conventions as the international metric system of measures (of length, volume, and weight). So it should not be expected that reform and progress, in the area of systems of money, will be very easily achieved.

Nowadays we see some new areas of competition between different major currencies of the world since the euro has come into existence and the psycho- logical climate in which the "central bankers" are operating is recently changed by the theme of "targeting" that is described later below."

Hal Finney is one of the coders thought to maybe be Satoshi, he cites George Selgin when asked how bitcoin might scale since its base layer is slow and costly etc:



Selgin fleshes out a game theoretically sound argument which simply has the premise that there is no monopoly issuer on the base layer settlement unit. Basically what happens is if a private bank over issues its private currency, it will eventually find that currency naturally returning, and if they are nefarious and careless about it they will suffer from a currency based attack.

I have notes that explain everything from Selgin's work but I suspect this will be agreeable here without even going thru it all. The key is that the supply of the base layer is controlled and private currencies can exist.

Btw with the ftx scandal we saw this in real time. The competing exchange that they were supposed to be trading each others private currencies with, signaled hard on twitter right before they lit ftx on fire. In the news you see this as terrible, and I have no voice to point out how hypocritical it is to ignore the sentiments of Hal. One honest exchange exploited the others greediness and the damage to the guilty party is a boon to the public.

Here 'honest' means honest to the customer and vicious to the competing and cheating private exchange.

That's what FTX was and all the other exchanges. It would need to be state run. But then what's the point of having Bitcoin in the first place?

What would need to be state run? (FTX had obvious state ties)

Yes the literature cited fleshes out how the competition between exchanges will eventually force out the dishonest ones based on survival of the fittest. But its not just saying 'survival of the fittest will prevail'. Its critical that there is the apolitical settlement medium to arbitrage. With that axiom present the system tends towards a monetary supply equilibrium (ie no exchange can deviate from the option currency supply vs base layer reserve ratio).

FTX was selling its customers custodied Bitcoin and this eventually gave the competing exchange the ability to sink them. Of course the media doesn't explain it this way, as the media was running false narratives in support of ftx's misconduct.

This can only be true if honesty is rewarded, but in the real world, in many different aspects of capitalism, dishonesty, or ****ery in general, provides a competitive advantage over honesty and fair treatment of workers and so on. Which again accounts for what we see, which is plenty of dishonesty and general ****ery by corporations, who rightly see that they are disincentivized to do good and incentivised to cut corners, pay their staff the minimum they can get away with regardless of whether that's below the poverty line, rape the environment, and bribe politicians to regulate in their favour. That's the legacy of the profit motive.

Well this statement of mine is quite a mathematical one. It's my expression of the formalized math etc.

In a system where exchanges are players and there is the ability to arbitrage via a base layer transferable utility, the supply ratios of the private currency units versus the reserve currency held tends towards a nash equilibrium where no exchange can gain by unilaterally deviating from the optimal ratio....

We should be able to flat out agree on that before your considerations come in (ie because it speaks to a model not reality).

My favourite cartoonist ever, Bill Watterson, creator of Calvin & Hobbes, studied political science at school:



I've no idea what your middle paragraph says. I'm not an economist. What I do know is that libertarian economists have made it a feature of their praxis to replace reality with models that show things in their favour. Economics must be a study grounded in reality in the same way that all sciences must hew to reality if they are to have any value or reference to the real world. Otherwise it's just masturbatory philosophy. So while we can start off from ideas like the state of nature, or the veil of ignorance, and so on, starting off from a place we know not to be true, such as 'honesty is rewarded' or 'the minimum wage reduces employment' or 'government intervention is bad for the people' is getting away from economics as a science and why it is known as the 'dismal science', far more of a soft science than for example psychology, given how it's been taught since the libertarian capitalist hegemony has been in power for the last ~40 years.